Mr Powell, 38, First Secretary at the British Embassy in Washington, is the younger brother of the former Prime Minister Baroness Thatcher's personal foreign affairs adviser, Sir Charles Powell.
Jonathan Powell did not join the Labour Party until last year, but met Mr Blair when he and Gordon Brown, the shadow Chancellor, visited Washington last year. 'I have been a life-long Labour supporter and it was Tony who inspired me to join the party,' Mr Powell said.
He was 'delighted' Mr Blair had asked him to join his team, and could think of no more exciting challenge.
Mr Blair said Jonathan Powell was 'hugely experienced', with considerable managerial and diplomatic expertise.
Sir Charles earned the nick-name The Real Deputy Prime Minister during his period as one of Lady Thatcher's most trusted advisers. The split in political loyalties is not the first in the family. Chris Powell, a third brother, was senior adviser on party advertising to Neil Kinnock, the former Labour leader.
Jonathan Powell entered the Foreign Office in 1979 and has served in South Africa, Portugal, Vienna and Hong Kong. He has been based in Washington since July 1991.
One of four sons of Royal Air Force Vice-Marshall John Frederick Powell, he is married with two children.